Mandy Jiang, executive director and CFO at CloudTech Group, said SMSF owners have been interested in digital assets but cautious about direct exposure.
“The absence of clear rules around custody, platform accountability and asset protection has made crypto difficult to reconcile with trustee obligations around prudence, governance and auditability. That equation is now changing,” Jiang said.
“As regulatory clarity replaces uncertainty, SMSF owners and their advisers will be better placed to assess whether and how crypto fits within a diversified retirement portfolio, as appropriate safeguards and custody processes are put in place to protect investors.”
The bill was originally introduced in late November 2025 and amends the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001 to regulate digital asset platforms and cryptocurrency exchanges.
It means platforms holding client digital assets are required to obtain an Australian Financial Services Licence, in a move aimed at strengthening consumer protection and lifting platform safety standards.
The legislation creates two new regulated categories — digital asset platforms and tokenised custody platforms — bringing them under the same core rules that apply to brokers and fund managers.
The new laws aim to reduce risks such as commingling and misuse of customer assets while positioning Australia to capture a larger share of an estimated $24 billion annual digital finance opportunity.
Jiang said the new legislation “directly addresses” many of the concerns SMSF trustees had about investing in digital assets by extending Australia’s existing financial services regime to cover digital asset platforms and custody providers.
“Importantly, the focus is not on regulating the underlying technology, but on the intermediaries that hold assets on behalf of investors,” she said.
“This distinction is critical for SMSFs. It means that platforms and custodians will be subject to licensing, disclosure and operational standards that trustees, auditors and advisers already understand.
“In practice, this brings crypto closer to other alternative assets that SMSFs already access, making it easier for trustees and their advisers to assess, document and justify allocations within a familiar governance framework.”
She added that for advisers, this also removes a key barrier to engagement, providing greater confidence that client assets are held within a framework aligned to existing compliance and audit expectations.
“Data from BDO Australia shows that SMSF exposure to digital assets is already significant and has grown rapidly over recent years. According to the ATO, SMSFs held approximately $3.02 billion in digital assets as at June 2025. While this represents a modest four per cent year‑on‑year decline, it is a substantial increase from 2019, when SMSF crypto holdings totalled just $119 million,” she said.
“The figures also point to a clear demographic shift. SMSFs with balances under $200,000 allocate close to seven per cent of their portfolios to crypto and digital assets, compared with an average allocation of around two per cent across all SMSFs. This suggests younger trustees and newer funds are showing a stronger appetite for emerging asset classes.”
Furthermore, Jiang said, for SMSF trustees, regulated custody has practical implications.
“Minimum standards around asset segregation, recordkeeping, reconciliation and reporting will make it easier to demonstrate ownership and valuation, which are key considerations during annual audits,” she said.
“Stronger custody frameworks also reduce the risk of commingling and misuse of client assets, issues that have underpinned some of the most high-profile crypto failures globally. While market volatility will always remain a feature of digital assets, improved governance and oversight help address risks that are structural rather than market driven.”